CONTEXT hosted a breakfast briefing at CES in Las Vegas last week. Our objective was to examine the issues European retailers would be facing over the coming months against a backdrop of fierce pricing pressures from online retailers. Confirmed attendees included players like Dixons, Boulanger, Auchan, Mondadori as well as the CEO’s of Darty, Euronics, Lick and Bimeks, and senior representatives from vendors and distributors such as Lenovo, Acer, Samsung, AMD, Netgear, Webroot, the GTDC and Esprinet.
During the session, some of Europe’s leading consumer technology retail executives gave their view on market trends for 2015 and raised the question of whether connected devices and the advent of IoT would provide bricks and mortar retailers with new opportunities to revitalise sales and improve relationships with their customers.
Hans Carpels, president at Euronics International, stated: “IoT is one of the main topics for 2015, but the IoT landscape is complex, fragmented and in full motion. It is not an easy area to serve as a retailer.”
With so many categories fusing together to create the smart home environment, there is inevitably a degree of complexity. The challenge for retailers is to help consumers overcome the complexity and purchase the products.
Carpels explained: “The real value of these products to the consumer has to be clear and easy to understand. We need to explain the efficiency and the economic advantages.”
Retailers increasingly understand that they cannot compete on price against pure-play online retailers. They need to find a differentiating factor, which allows them to get closer to customers and justify the operating expenses associated with running physical stores.
Regis Schultz, chief executive at Darty, said: “How you define great retail service in the internet world is much more complex. The whole raison d’etre of retail is to transform the ‘consumer’ into a ‘customer’- that’s where the real value lies.”
“If physical retail is nothing more than a supply chain the only possible future outcome will be making no profit,” he added. “Our challenge is to recapture what makes our industry profitable by moving the mass of consumers to become customers that we truly know and understand.”